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International Journal of Business and Management Invention (IJBMI)
ISSN (Online): 2319 – 8028, ISSN (Print): 2319 – 801X
www.ijbmi.org || Volume 8 Issue 10 Series. III || Oct 2019 || PP 04-17
www.ijbmi.org 4 | Page
Analyzing the Recording and Adjusting Procedures of Foreign
Remittance a study on JANATA BANK LTD at Jamuna Future
Park Branch, Bangladesh
Arif Ahsan, Mouly Deowan,
Assistant Professor, College of Business Administration (CBA), IUBAT, Dhaka, Bangladesh
Student of Accounting Major, College of Business Administration (CBA), IUBAT, Dhaka, Bangladesh
Corresponding Author: Arif Ahsan
ABSTRACT: This entire report that we have prepared is based on the foreign remittance process in JBL on the
topic “Analyzing the Recording and Adjusting Procedures of Foreign remittance, a study on Janata Bank
Limited at Jamuna Future Park Branch”. The purpose of this study is to analyze and evaluate the recording and
adjusting process of foreign remittance in Janata Bank Limited and how they do. For conducting this report, the
data has been collected from the primary and secondary sources. The scope of this report is limited to the
foreign remittance section of Janata Bank Ltd. In this report, the recording and adjusting procedures of foreign
remittance sections of Janata Bank Ltd. are discussed. JBL constantly monitors, reviews and analyzes its
foreign remittance related problem and minimizing potential losses and ensuring efficient foreign remittance
process. Not only that but also analyzes some risk behind foreign remittance, for analyzing that JBL has to
analyze such risks. Janata Bank Ltd. Foreign remittance recorded and adjusted according to standard
procedure. During this research, we found that the bank has affected by operational risk and lack of modern
technology which has had a bad effect on the profitability of the bank.
KEY WORD: Journal Entry, Transaction Analysis, Foreign remittance, Accounting recording process.
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Date of Submission: 20-10-2019 Date of acceptance: 03-11-2019
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I. INTRODUCTION In accounting every process of a transaction starts with identifying and analyzing transaction. Analysis
aims to find out whether any economic activity incurred or not. If any economic activity incurred then it has
been recorded into transaction which is called transaction analysis. Finally it has been recorded in to journal as
part of recording process. Recording process of foreign remittance is the combination of recording into journal
and identification of remittance activities. Banks maintain their remittance activities through different types of
process or steps. In each of these steps required to be recorded by different branches or offices at a time. In this
report we have used the example of Janata Bank, Dhaka, Bangladesh which is the second largest and one of the
four state-owned commercial banks in Bangladesh which had been established under the Bangladesh Bank
ordered by 1972 (Presidency Order of 1972). There are around nine hundreds branches of Janata Bank and we
have considered Jamuna Future Park Branch, Dhaka, Bangladesh of Janata Bank for focusing on the recording
process of foreign remittance (Janata Bank Limited).
Objective of the study
The broad objective of the study is to analyze the recording and adjusting procedure of Foreign
Remittance in Janata Bank Limited and get an in-depth idea of the foreign remittance process of Janata Bank
Limited through the review of the foreign remittance system and recording and adjusting method and
monitoring process.
Scopes of the study
This paper will help the reader to get most of the information about recording process of foreign
remittance and how the transactions are made and entered in foreign remittance in a bank. This information can
be used for further in depth research of foreign remittance.
Limitations of the study
This paper has been prepared based on one of the public bank of Bangladesh. So it will be helpful for
the researcher who wants to pursue their research on Bangladeshi banking system focusing on foreign
remittance. Any researcher outside Bangladesh can read this paper only for gathering knowledge for
understanding procedural purpose but not for using purpose.
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II. LITERATURE REVIEW Recording and Adjusting in Accounting Process
The accounting process is otherwise known as the accounting cycle, which indicates that the process
involves continuous repetition. This cycle is important as it makes it possible for businesses to prepare new
financial statements when necessary. In the accounting process, a bookkeeper collects, organizes, processes, and
closes every financial information of a business. For medium-sized businesses, the steps involved in the
accounting process provide a clear view of the financial health of their business. This process, in turn, helps
them to reduce risks when it comes to managing the business.
The Recording process
The business transaction, therefore, forms a complete cycle and several steps are taken to complete a
financial statement. This complete chain of forming a proper business transaction and financial statement in
called as a recording process.
The recording process is the whole process that goes on in maintaining a financial statement. From the
very starting to the destination of the statement, the recording process involves various steps that are to be taken
to maintain a good and proper account. These steps are nine in number and help to remove all the flaws from the
transaction so made. This recording process starts from the very beginning, from the process of identifying and
analyzing transactions and events to reaching the post-closing trial balance.
Record transactions in the journal
This is also known as journalizing. A journal historically lists transactions and other events in terms of debits
and credits to accounts. Each journal entry consists of four parts:
a) The accounts and amounts to be debited: To debit an account mean to enter an amount on the left side of
the account.
b) The accounts and amounts to be credited: To credit an account mean to enter an amount on the right side
of an account.
c) The date of transaction: It means a journal is a record of financial transactions in order by date.
d) A transaction explanation: It means explain the transactions in the time of recording.
The Adjusting Process
A lot of revenues and expenses are recorded during the period as they occur, but a lot of accounts are
not. For these accounts the accountant must determine when to recognize these accounts and adjust them at the
end of the accounting period in order to bring them up to date. When dealing with the timing of revenue and
expense recognition there are two terms that must be understood, Accrued and Deferred.
Preparing Adjusting entries
Adjusting entries are journal entries recorded at the end of an accounting period that alter the final
balances of various general ledger accounts. These adjustments are made in order to more closely align the
reported results and the actual financial position of a business. Adjusting entries follow the principles of revenue
recognition and matching.
Adjusting entries are made to report
a) Revenues that have been earned but not yet entered into the accounting records,
b) Expenses that have been incurred but have not yet been entered into the accounting records,
c) Revenues already recorded that pertain to a future accounting period, or
d) Expenses already recorded that pertain to a future accounting period.
Risk factor during recording and adjusting Typically, accounting involves the process of recording, summarizing, adjusting and analyzing. This
can be difficult, but there are common obstacles which owners must overcome. In their operations banks are
particularly exposed to or may potentially be exposed to the following risks like
Operational Risk According to the Bank for International Settlements (BIS), Operational risk is defined as the risk of
loss resulting from inadequate or failed internal processes, people and systems or from external events. This
definition includes legal risk but excludes strategic and reputation risk. Operational risk can widely occur in
banks due to human errors or mistakes. Examples of operational risk may be incorrect information filled in
during clearing a check or confidential information leaked due to system failure. Operational risk can be
categorized in the following way for a better understanding:
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a) Human risk: Potential losses due to a human error, done willingly or unconsciously
b) IT/System risk: Potential losses due to system failures and programming errors
c) Processes risk: Potential losses due to improper information processing, leaking or hacking of information
and inaccuracy of data processing
Cyber security Risk
Cyber security risk is the most prevalent IT risk in the financial services industry. It refers to the risk
undertaken by a financial institution to keep electronic information private and safe from damage, misuse or
theft. Cyber security risk is as much of a people risk as it is technology risk. The risk arises from a range of
external and internal factors at banks such as:
Missing transaction business controls
Poor password policies
Inadequate logical access controls
Inadequate use of Modern Technology Today, information and communication technology has become the heart of banking sector and
banking industry is at the heart of every robust economy. Electronic banking system has become the main
technology driven revolution in conducting financial transactions. The modernization of ICT has set the stage
for extraordinary improvement in banking procedures throughout the world. Still Banks are not started giving
importance to new technologies. But some banks are still lagged behind. Like –
a) Collect the handwritten documents from branches
b) Compile the documents
c) Manual data entry by the operators
d) Execute some banking transactions
Foreign Remittance
A foreign remittance is a transfer of money from a foreign worker to their family or other individuals in
their home countries. In many countries, remittance constitutes a significant portion of a nation’s gross domestic
product or GDP. The United States is the leading source of foreign remittances, followed by Russia and Saudi
Arabia. The top recipients of foreign remittances are India, China and the Philippines.
Remittance activities at JBL
1. Local / Inland Remittance:
a) Inward Remittance
b) Outward Remittance
2. Foreign Remittance
a) Inward Remittance
b) Outward Remittance
General Procedures of Foreign Remittance recording
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Foreign Remittance service at Janata Bank Limited
Janata Bank Limited has a network of 906 domestic branches in Bangladesh covering whole of the
country including the rural areas. Remittance services are available at all branches and foreign remittances may
be sent to any branch by the remitters favoring their beneficiaries. Remittances are credited to the account of
beneficiaries instantly or within shortest possible time. Janata Bank Limited has correspondent banking
relationship with all major banks & exchange houses located in almost all the countries/cities. Expatriate
Bangladeshis may send their hard earned foreign currencies through those banks & exchange houses or may
contact any renowned banks nearby ( where they reside/work) to send their money to their dear ones in
Bangladesh.
"To resolve the foreign remittance related problem/complain/enquiry, Janata Bank Limited has a
'Complain cell' at its Overseas Banking Division, Head Office, Dhaka. All Concerned are requested to contact at
the following address to resolve any problem related to foreign Remittance."
In 2017, the bank achieved total inward foreign remittance of BDT 72,022.00 million that represents a
significant share of total national remittance in Bangladesh. In 2017, Janata Bank has honored with ―Bangladesh
Bank Remittance Award-2016‖ as one of the highest remittances earning banks. Moreover, Bangladesh Bank
has also awarded 26 individuals who sent the highest amounts of remittance to Bangladesh last year. Out of
them, 11 honorable clients of Janata Bank have received ―Bangladesh Bank Remittance Award-2016‖ for
sending home the highest amount of remittance and investing bonds.
Documents required for collecting NRB Remittance
a) Customer has to fill-up an EFT Application Form of JBL where the information of sender and receiver is
required
b) Transfer code is needed
c) National ID card or Passport or Driving License or any authorized and certified certificates where a
photograph and signature of receiver is given.
There are two types of Foreign Remittance:
a) Inward Foreign Remittance.
b) Outward Foreign Remittance.
Janata Bank Ltd. Is performed both inward and outward foreign remittance activities:
Inward Foreign remittance
In the case of Inward foreign remittance, the foreign currency is entered in Bangladesh. Previously for
transfer foreign currency the customer was must have an account in the bank like Janata Bank Ltd. But in the
present time a customer can get foreign currency without having an account in the respective branch or any bank
like Janata Bank Ltd.
Procedures of Foreign Remittance recording
In this term they record the transactions through Debit and Credit procedure. Debit and Credit are
directional signals. Entering an amount on the left side of an account is called debiting the account. Making an
entry on the right side is crediting the account. Having debits on the left and credits on the right is an accounting
custom, or rule.
Debit and Credit procedure
Each transaction must effect of a transaction on the basic accounting equation. In other words, for each
transaction, debit must equal credits in the accounts. The equality of debits and credits provides the basis for the
Double-Entry System of recording transactions.
In the double-entry system the dual (two-sided) effect of each transaction is recorded in appropriate
accounts. This system provides a logical method for recording transactions. It also helps ensure the accuracy of
the recorded amounts. The sum of all the debits to the accounts must equal the sum of all the credits.
Procedure of Recording
In case of Inward Foreign remittance, they are following this type of foreign remittance facilities-
1. SRC [Speedy Remittance cell]
a) SRC- to Account
b) SRC- TTR/Payment Order (P.O.)
c) SRC- to Instant/ Spot cash.
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SRC (Speedy Remittance Cell)
Janata Bank Limited has started its own exchange system named SRC (Speedy Remittance Cell).
SRC launched its operation in 14.05.2009. SRC is now the most popular transaction system due to less time
consuming this type of transaction makes the help of internet it’s also called online banking system.
SRC- to Account
In this case the money is transferred directly to the beneficiary Account. So, in this case the beneficiary mast has
an Account in any branch of Janata Bank Ltd.
Example:
Date: 15 January 2019
Suppose Janata Bank Ltd Dubai Branch send an SRC- to Account to the Janata Bank Ltd Head Office
(HIC), 110 Motijheel C/A Dhaka 1000. The beneficiary's (receiver) responding branch is Jamuna Future Park
Branch Dhaka 1229. The Beneficiary's Account No. is 100023-0 and the amount of taka is Tk 1,50,000/. when
the H/O receives this E-mail report from Dubai Branch then HO verify this report and send this report to the
beneficiary branch (Jamuna Future Park Branch) of Janata Bank Ltd.
Remittance officer of Jamuna Future Park Branch will receive that report from H/O and transfer the
amount of money to the beneficiary Account Then the beneficiary withdraws this money by cheque.
In this case following entry will be passed by responding branch:
Date Account Titles and Explanation Ref. Debit Credit
2019
Jan.15
CIBTA A/C 1,50,000
Party’s A/C 1,50,000
Explanation
In the tabular summary, the term ―CIBTA Account‖ is debited by the amount of 1,50,000 taka because
they get the money from HO. And the other side they credited the term ―Party’s Account‖. Because they transfer
the full amount to the beneficiary account on Janata Bank limited.
(Here the term CIBTA means CREDIT INTER BRANCH TRANSACTION ADVICE).
SRC- TTR Payment Order (P.O.)
SRC- TTR/ Payment Order (P.O.) is a special type of Speedy Remittance Cell where the money is sent from
foreign branch of JBL to the Head Office (HO) of Janata Bank Ltd Dhaka for payment to another Bank
customer's A/C.
Example:
Date: 20 January 2019
Suppose Mr. SM. Razib in Dubai. He wants to send money to his father by Janata Bank Dubai Branch.
But the problem is that his father has no, Account in Janata Bank Ltd But his father has an Account in ABC
Bank Ltd.
In this case the JBL Dubai Branch receives the money Tk 2,00,000/ and sends SRC- TTR Payment Order (P.O.)
massage to Janata Bank Ltd. Head Office (WC), 110 Motijheel C/A Dhaka 1000 to provide money on account
of "Mrs. Habib & Sons" A/C No. 2000010-1 at ABC Bank Ltd. Jamuna Future Park Branch. When the HO
receives this E-mail message from Dubai Branch then HO verifies this massage and the HO may send this
massage to the nearest branch of ABC Bank's Ltd. Jamuna Future Park Branch. Suppose the nearest branch of
ABC Bank Ltd is Janata Bank Ltd. Jamuna Future Park Branch.
When the HO of JBL sends the SRC massage to the Janata Bank Ltd Jamuna Future Park Branch then the
officer JFP Branch will receive the massage and issue a Payment Order against the ABC Bank Ltd. JFP Branch
with the beneficiary's Account Name and A/C number.
Then Janata Bank Ltd JFP Branch will send the Payment Order (P.O.) to the ABC Bank Ltd. JFP
Branch and ABC JFP Branch will collect money via Clearing House and then transfer the money to the
beneficiary Account.
In this case following voucher will be passed by Janata Bank Ltd JFP Branch-
Date Account Titles and Explanation Ref. Debit Credit
2019
Jan.20
CIBTA 2,00,000
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SRC- to Instant/Spot cash.
Janata bank Ltd has signed an agreement with NRB Foreign Remittance. Like
Western Union Money Transfer Services
Continental Exchange Solution (Ria Financial Services)
Money Gram International
Xpress Money Services
Prabhu Money Transfer
UEC (United Exchange Corporation) etc.
In this case the beneficiary can get money without having an Account in Janata Bank Ltd. Janata
Bank's foreign agent collect money from customer and send an E-mail message with a (MTCN) Money Transfer
Controlling Number. After receiving the E-mail message from responding foreign agents the Head Office
verifies this report and then send this report to the beneficiary branch of Janata Bank Ltd.
Example:
Date: 25 January 2019
Suppose Janata Bank Ltd Dubai Branch send an SRC- to Instant/Spot cash to the Janata Bank Ltd.
Head Office (HO), 110 Motijheel C/A Dhaka 1000. The beneficiary's (receiver) responding branch is Jamuna
Future Park Branch Dhaka-1229. The Beneficiary's name is S-M. Razib and the amount of taka is Tk 100,000/-
and Money Transfer Control Number (MTCN) is 120152000002.
When the HO receives this E-mail message from Dubai Branch then HO verifies this report and sends
this report to the beneficiary branch (Jamuna Future Park Branch) of Janata Bank Ltd.
Jamuna Future Park Branch Officer receives the massage with a MTCN. The owner and wait for
beneficiary. When the beneficiary comes to the bank then he / she will ask the officer he has an SRC- to instant /
Spot cash.
Then the officer of JFP Branch will provide a form to fill-up. In this form the beneficiary will provide following
information-
a) Name of Issuer or customer.
b) Name of Beneficiary
c) Name of Branch. (where beneficiary collect money)
d) Amount of Currency (Taka).
e) MTCN — Money Transfer Control Number.
f) Address of Beneficiary.
g) Photocopy of National I.D. card or Passport.
Then the officer of Jamuna Future Park branch will verify this information with HO massage. If all the
information is correct, the officer will give cash memo and the beneficiary will collect money from the cash
counter.
In this case following will be passed by responding branch
Explanation
In the tabular summary, the term ―CIBTA Account‖ is debited by the amount of 1, 00,000 taka because
they get the money from HO. And the other side they credited the term ―Sundry Deposit (SD) A/C, Sundry
creditors‖. Here the term ―Sundry creditors ―are such small entities that the company owes money. Sundry
creditors in under current liabilities.
Adjusting Foreign Remittance Spot Cash
In the case of adjusting, Janata Bank adjusts money only for Foreign remittance spot cash. This is a step how
they adjust money
Bills Payable A/C, Payment Order (P.O.) issue 2,00,000
Date Account Titles and Explanation Ref. Debit Credit
2019
Jan.25
CIBTA A/C 1,00,000
Sundry Deposit (SD) A/C, Sundry creditors 1,00,000
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Step 1: Open Suspense Account
There is a command from Janata Bank Head office is every branch should open an account named
―Suspense Account‖ for respective money transfer method like (Suspense account for Western union, suspense
account for Ria money transfer, Suspense account for Money Gram) etc.
Step 2: Verify Account
There is a system of bank that FRD officer post the transaction to the software then they need to another
respective officer to verify that transaction.
Step 3: Authorize Account
And finally, they need again another officer to authorize that transaction. That means one individual
officer cannot fulfil the whole transaction procedures. They need three officers to complete the foreign
remittance method.
Step 4:
After authorizing the transaction, they software will give two vouchers. One voucher will provide to
the beneficiary with signature and sill and another will be registered in respective register book. After that it will
filed along with form. After that beneficiary will give the voucher and collect money from cash counter.
Example:
Date: 30 January 2019
Suppose a sender named Mr. Karim send money from Janata bank limited Abu Dhabi Branch to Janata
bank ltd head office (H/O), 110 Motijheel C/A Dhaka-1000 through Western Union Money Transfer. The
beneficiary’s (receiver) resounding branch is Janata bank Jamuna Future park branch, Dhaka-1229. The
beneficiary’s Account no. is 100023-0 and the amount of taka is Tk. 50,000/-
Then the officer giving the following transaction entry to the JB official software:
Explanation
In the tabular summary, the term ―Suspense Account‖ represents an unclassified transaction. Most
likely the Unclassified Transactions are miscellaneous parts of the bank that lack some information needed to
classify them into any of the other categories or do not fit into any one class available. These transactions are the
liabilities. In this account the bank creates suspense account and gives the full amount. So, they debited the
suspense account and the other side they credited the term ―Cash‖. Because they paid the full amount to the
beneficiary.
Date Account Titles and Explanation Ref. Debit Credit
2019
Jan.30
Suspense Account 50,000
Cash 50,000
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Procedures of Foreign Remittance Reimbursement
Open a suspense account by recording the full amount in question. The Head office of Janata Bank Ltd
might receive the payment later. But when the beneficiary goes to their near branch to collect money that branch
create a suspense account for the payment. They debit the Suspense Account and credit the cash account with
the amount 1, 00,000 taka.Whenthe head office of Janata Bank Ltd. finds out which branch made the payment,
they send the full amount to that branch. It is called Reimbursement.
After 1 /2 days or around 1 week the branch get adjustment or reimbursement from Advice office. There are two
offices who issued advice or reimbursement-
1. Janata Bhaban Corporate
2. Dilkusha Corporate Zone
These two-office issued advice after getting money from Transfer Company. After getting advice the branch
will post this following entry:
If Janata Bhaban Corporate issued advice-
Transaction (1) for Western Union
If Dilkusha Branch issued advice-
Date Account Titles and Explanation Ref. Debit Credit
2019
Feb. 2
CIBTA Janata Bhaban corporate 50,000
Suspense A/C NRTA western union 50,000
Here the term CIBTA means CREDIT INTER BRANCH TRANSACTION ADVICE.
Explanation
In the tabular summary, they debited ―Janata Bhaban‖ because they reimburse the amount 1, 00,000 to
the bank and the other side, they credited the term ―Suspense Account‖. Because the bank previously (In
transaction (1) recorded suspense account as an increase in Accounts Payable. And decrease the cash from the
branch fund. The payment ―Dilkusha Corporate Zone‖ decreased the liability by 1, 00,000.
Transaction (2)
If Dilkusha Branch issued advice-
Date Account Titles and Explanation Ref. Debit Credit
2019
Feb. 2
CIBTA Dilkusha Corporate zone 50,000
Suspense A/C NRTA western union 50,000
Explanation
In the tabular summary, they debited ―Dilkusha Corporate zone‖ because they reimburse the amount 1,
00,000 to the bank and the other side, they credited the term ―Suspense Account‖. Because the bank previously
(In transaction (1) recorded suspense account as an increase in Accounts Payable. And decrease the cash from
the branch fund. The payment ―Dilkusha Corporate Zone‖ decreased the liability by 1, 00,000.
JOURNAL ENTRIES All the journal entries are shown here-
SRC- to Account -
Date Account Titles and Explanation Ref. Debit Credit
2019
Jan.15
CIBTA A/C 1,50,000
Party’s A/C 1,50,000
SRC- TTR Payment Order (P.O.) –
Date Account Titles and Explanation Ref. Debit Credit
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2019
Jan.20
CIBTA 2,00,000
Bills Payable A/C, Payment Order (P.O.) issue 2,00,000
SRC- to Instant/Spot cash-
Date Account Titles and Explanation Ref. Debit Credit
2019
Jan.25
CIBTA A/C 100,000
Sundry Deposit (SD) A/C, Sundry creditors 100,000
Adjusting the Money-
Date Account Titles and Explanation Ref. Debit Credit
2019
Jan.30
Suspense Account 50,000
Cash 50,000
After Reimbursement-
Date Account Titles and Explanation Ref. Debit Credit
2019
Feb.2
CIBTA Janata Bhaban corporate 50,000
Suspense A/C NRTA western union 50,000
Voucher issue
At the closing time, the head office sends a voucher to the branch where consists all transactions.
Which is called “Supplementary Sheet” Then the respective officer checks the sheet with voucher whether the
debit credit voucher is equivalent or not. If the transactions are equivalent, then they can close the transaction.
Outward Foreign Remittance
When remittance is sending from Bangladesh to London then it is called outward foreign remittance.
But outward foreign remittance is highly restricted by the Bangladesh government. Only some special branches
of all banks can send money from Bangladesh to abroad under Bangladesh bank rules and regulations.
In Janata bank ltd following branches are only responsible and involved outward foreign remittance activities.
1. Local office Dhaka.
2. Foreign exchange Branch, BitulMukaram Dhaka.
3. Janata Bhaban Corporate Dhaka.
Effect of Foreign Remittance adjusting:
This kind of adjusting is a liability for the bank. It creates negative impression. Suspense account is a
liability account that reports the amounts received by the Head office of the bank but have not yet been earned
by the respective branch.
A suspense account is an account where you record unclassified transactions. The account temporarily
holds entries while you decide how you will classify them. A suspense account can also hold information about
discrepancies as you gather more data. When you open an accounting suspense account, the transaction is
considered in suspense. You can open a bank account to hold funds for suspense accounts. This keeps
uncategorized transactions from categorized transactions.
A suspense account is a general account found in the general ledger. Depending on the transaction in
question, a suspense account can be an asset or liability.
If it's an asset in question, the suspense account is a current asset because it holds payments related to accounts
receivable. A suspense account could also be a liability if it holds accounts payables that you do not know how
to classify.
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III. METHODOLOGY Mainly quantitative research method has been used to conduct this research through identifying a major
problem in the place of research. A questionnaire has been developed to conduct the research under normal field
conditions based on 5-Point Liker Scale. We have surveyed our questionnaires to ten (10) respondents as our
population size is fifteen (15). The size of the population and sample is small because Janata Bank, Jamuna
Future Park Branch, Dhaka, Bangladesh is a new and very small branch in terms of number of employees. We
have tried to collect information about security policy, operation management system for recording and
adjusting and modern technology used in Janata Bank, Jamuna Future Park Branch, Dhaka, Bangladesh. We
have used Microsoft Excel, different tables and graphs to calculate and test the hypothesis to derive a
meaningful conclusion from the practical data. In addition, basic statistical techniques of different measures of
vital leaning have been used for analyzing the data. We have used t-test for the study because the sample size is
less than thirty (30).
IV. DATA ANALYSIS AND FINDINGS List of hypothesis that has been used for analysis
H1: If JBL enforce their security policy then it will prevent their privacy from cyber security risk.
H2: If JBL develop the operation management system properly then it can reduce the operational risk from
recoding and adjusting.
H3: Absence of modern technology in foreign remittance is a major problem in JBL.
H4: Using of modern technology in foreign remittance is better than human based processes.
H5: Lack of knowledge about modern technology of employees and staff’s effects on foreign remittance
recording task time consuming.
Article of T-Test Calculation
In T-test I followed one tail test that’s why here,
Ho: μ = 2.5
HA: μ ≠ 2.5
In 5-point scale the μ value is 2.5.
Here,
Mean value (μ = 2.5)
n = Sample size = 10 𝐱 = Average
Standard Deviation (s) = ∑𝐟𝐢(𝐱𝐢−𝐱 )𝟐
𝐧−𝟏
Hypothesis: 1 HO: If JBL enforce their security policy then it will not prevent their privacy from cyber security risk.
HA: If JBL enforce their security policy then it will prevent their privacy from cyber security risk.
Step 1: To Find Total: 0x 1 = 0
1x 2 = 2
1x 3 = 3
6x 4 = 24
2x 5 = 10
Total = 39
Step-2: To find average𝐗
𝐱 =∑𝐟𝐢𝐱𝐢
𝐧 Here, ∑𝐟𝐢𝐱𝐢 from value of hypothesis 1 which is 39, n = 10
= 𝟑𝟗
𝟏𝟎
= 3.9
Step-3: Standard deviation
𝐒𝐃 = ∑𝐟𝐢(𝐱𝐢−𝐱 )𝟐
𝐧−𝟏
= 𝟎 𝟏−𝟑.𝟗 𝟐 + 1 𝟐−𝟑.𝟗 𝟐 + 𝟏 𝟑−𝟑.𝟗 𝟐 + 𝟔 𝟒−𝟑.𝟗 𝟐 + 𝟐 𝟓−𝟑.𝟗 𝟐
𝟏𝟎−𝟏
= 6.9
𝟗 = 0.766 = 0.88
Step-4: Critical Value
Degree of Freedom, df
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df = n − 1 [ Independent sample size]
= 10 − 1
= 9
𝐓𝐭𝐚𝐛 =2.262
Step-5: To find T value
𝐭𝐜𝐚𝐥 = 𝐱 − 𝛍
𝐒
𝐧
=3.9− 2.5
0.88
10
= 5.03
Step-6: Decision
At the 5% level of significance, the value of T in T- distribution table is T 0.05=2.262. Since the value of
Tcal>Ttab that means the null hypothesis is not accepted because Tcal is greater than Ttab. So, at 5% level of
significance, it can be said that- If JBL enforce their security policy then it will prevent their privacy from cyber
security risk.
Hypothesis: 2 HO: If JBL develop the operation management system properly then it cannot reduce the operational risk from
recoding and adjusting.
HA: If JBL develop the operation management system properly then it can reduce the operational risk from
recoding and adjusting.
Step 1: To Find Total
Total = 38
Step-2: To find average𝐗
𝐱 = 3.8
Step-3:Standard-deviation
𝐒𝐃 =1.398
Step-4: Critical Value
𝐓𝐭𝐚𝐛 =2.262
Step-5: To find T value
𝐓𝐜𝐚𝐥= 2.95
Step-6: Decision
At the 5% level of significance, the value of T in T- distribution table is T 0.05=2.262. Since the value of
Tcal>Ttab that means the null hypothesis is not accepted because Tcal is greater than Ttab. So, at 5% level of
significance, it can be said that if JBL develop the operation management system properly then it can reduce the
operational risk from recoding and adjusting.
Hypothesis: 3 HO: Absence of modern technology in foreign remittance is not a major problem in JBL.
HA: Absence of modern technology in foreign remittance is a major problem in JBL.
Step 1: To Find Total
Total = 37
Step-2: To find average𝐗
𝐱 = 3.7
Step-3:Standard-deviation
𝐒𝐃 =0.95
Step-4: Critical Value
𝐓𝐭𝐚𝐛 =2.262
Step-5: To find T value
𝐓𝐜𝐚𝐥= 4.01
Step-6: Decision
At the 5% level of significance, the value of T in T- distribution table is T 0.05=2.262. Since the value of
Tcal>Ttab that means the null hypothesis is not accepted because Tcal is greater than Ttab. So, at 5% level of
significance, it can be said that- Absence of modern technology in foreign remittance is a major problem in JBL.
Hypothesis: 4 HO: Using of modern technology in foreign remittance is not better than human based processes.
HA: Using of modern technology in foreign remittance is better than human based processes.
Step 1: To Find Total
Total = 36
Step-2: To find average𝐗
𝐱 = 3.6
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Step-3:Standard-deviation
𝐒𝐃 =1.50
Step-4: Critical Value
𝐓𝐭𝐚𝐛 =2.262
Step-5: To find T value
𝐭𝐜𝐚𝐥= 2.31
Step-6: Decision
At the 5% level of significance, the value of T in T- distribution table is T 0.05=2.262. Since the value of
Tcal>Ttab that means the null hypothesis is not accepted because Tcal is greater than Ttab. So, at 5% level of
significance, using of modern technology in foreign remittance is better than human based processes.
Hypothesis: 5
HO: Lack of knowledge about modern technology of employees and staff doesn’t effect on foreign remittance
recording task time consuming.
HA: Lack of knowledge about modern technology of employees and staff’s effect on foreign remittance
recording task time consuming.
Step 1: To Find Total
Total = 41
Step-2: To find average𝐗
𝐱 = 4.1
Step-3:Standard-deviation
𝐒𝐃 =1.19
Step-4: Critical Value
𝐓𝐭𝐚𝐛 =2.262
Step-5: To find T value
𝐭𝐜𝐚𝐥= 4.25
Step-6: Decision
At the 5% level of significance, the value of T in T- distribution table is T 0.05=2.262. Since the value of
Tcal>Ttab that means the null hypothesis is not accepted because T-cal is greater than T-tab. So, at 5% level of
significance, lack of knowledge about modern technology of employees and staff’s effect on foreign remittance
recording task time consuming.
V. RECOMMENDATIONS Janata Bank must ensure to keep their passwords, financial, and other personal information safe and
protected from outside intruders. Also they should keep Anti-malware protection so that they avoid getting
infected from periodic scans for spyware; avoid clicking on suspicious email links or websites etc. Security
service must be established strongly and supervised properly.
They should develop their Operational Risk Management because it reduced operating losses, earlier
detection of unlawful activities, and reduced exposure to future risks. This has not only caused operational risk
to be underestimated but has also obscured the underlying causes of many of the most significant financial
losses. Adaption of new technologies should be enforced as early as possible in JBL. All the PC’s in this branch
should be changed with update hardware and software which is very fast and updated. Their PC have
installation required equipment’s and daily up gradation. Computers can take in and process certain kinds of
information much faster than human can. They can perform calculations and doing any other task at superhuman
speeds. JBL should use modern technology in foreign remittance section. As a result, it will save the time for
both of client and bank. Finally, they should arrange strong and systematic training program for bankers
efficient. The disciplined environment makes them active. JBL should arrange some more training programs for
their officials. Quality training will help the officials to enrich them with more recent knowledge of International
Trade and financing as well different banking activities.
VI. CONCLUSION In modern banking, foreign remittance is one of the most important ancillary services performed by
every type of Banks. A nationalized commercial bank like Janata Bank Ltd can perform it with better than other
banks because of a wider network of branches and lower services charge. JBL has set up an independent
department named as Foreign Remittance Department (FRD) that exclusively handle payment and distribution
of all foreign remittances to the branches. FRD has assigned a dedicated and hard-working team that relentlessly
provide prompt service to ensure payment on due time Again, a strong position in International Banking and a
great link with various foreign exchange companies makes the process of collecting the foreign remittance
easier to this bank.
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Besides these advantage Fraud and error have been one of the most problematic and unsolvable matter
for JBL. Fraud is a major challenge of banking industry and this makes all banks vulnerable and distress. The
management of the Janata Bank limited spends their hard-earned money to curtail it occurrence. Moreover, it
puts question marks on the integrity of the employees and management of JBL and gives rise to absolute loss of
customers’ confidence in banking. JBL has lack of e-banking facilities and lack of privacy in their internal
system. As a result, it hampers remittance activities and also it faces external risks like hacking. Absence of
modern technology is also a major problem in JBL. And some other problem like operational risk can widely
occur in banks due to human errors or mistakes. This kind of potential losses occur due to system failures and
programming errors.
Also, there is lot of problem lacking like shortage of manpower, gap between officers of head office
and branches, etc. becomes a matter of concern which should be fixed as soon as possible to adopting new way
and technologies.
Remittance the subject of my study is a very small part of Janata Bank Ltd.’s activity. But it generates a
portion of profit. So, by removing or at least reducing the bank should try to achieve the targeted amount fixed
by the top management.
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List of Acronyms BEFTN Bangladesh Electronic Fund Transfer Network
BACH Bangladesh Automated Clearing House
BIS Bank for International Settlements
CIBTA CREDIT INTER BRANCH TRANSACTION ADVICE
DCFCL Departmental Control Functional Check List
EFT Electronic Funds Transfer
FRD Foreign Remittance Department
FC Foreign Currency
FDR Fixed Term Deposit account
GDP Gross Domestic Product
HO Head Office
IT Information Technology
IC Industrial Credit
ICT Information and Communications Technology
JBL Janata Bank Limited
JFP Jamuna Future Park
JB Janata Bank
MTCN Money Transfer Control Number
MT Money Transfer
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NRB Non-Resident Bangladeshi.
NID National Identity
ORM Operation Risk Management
P. O Payment Order
SD Sundry Deposit
SCB State-Owned Commercial Bank
STD Short Term Deposit
SME Small and Medium
SOD Secured Overdraft
SRC Speedy Remittance Cell
TTR Telegraphic Transfer
TDA Taka Drawing Arrangements
TIN Tax identification number
Arif Ahsan" Analyzing the Recording and Adjusting Procedures of Foreign Remittance
a study on JANATA BANK LTD at Jamuna Future Park Branch, Bangladesh"
International Journal of Business and Management Invention (IJBMI), vol. 08, no. 10,
2019, pp 04-17